Indexes Race For New All-Time Highs

Without too much attention from traders, the SPY and QQQ are racing to attempt to establish new all-time highs in what may become the most exciting Spring/Summer breakout rally of the past three years.While many other symbols are still flirting with November/December 2018 highs, the SPY and QQQ are both showing upside price gaps last week indicating a moderately strong price advancement is taking place.Additionally, both the SPY and the QQQ are already well above early 2018 peak levels.

If you were not paying attention, it sure looks like these two symbols are racing to be the first to break into “new all-time high levels” and shock the doomsayers (again) as we may see this rally continue for at least another 30 to 60 days.

If you’ve been following our research, you’ll know that our short-term research suggests new all-time high prices are imminent (very likely over the next 30 to 60+ days).We made this call back in September 2018 before the big selloff prompted by the US Fed. We also called the bottom on December 24, 2018, and warned that the subsequent rally would push hard in an attempt to target recent all-time highs. Now, as we near this event, we need to evaluate what may happen next.

This SPY chart shows the weekly price bars and just how close we are to new all-time highs.The SPY only needs to rally about $8 to breach into new record-setting territory. We believe the upside rally could continue well above the $300 level as this upside price bias should last until late May or into early June 2019.Therefore, we could see an upside potential of more than 5~8% before a new peak sets up.

This QQQ Weekly chart shows similar characteristics, yet shows one incredible variation to the SPY chart.The QQQ chart shows that price is breaching the lower YELLOW price channel and this may result in an impulse move higher in the QQQ that could push it to new highs before the SPY. The QQQ is even closer to all-time highs than the SPY – being only $2.15 away from reaching the all-time high level. If this breach of the lower YELLOW price channel prompts a bigger rally, we could see the QQQ rally upward towards $200 to $210 before setting up a new price peak.This represents a +7.5% to +13.5% upside potential for skilled traders.

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